In January 2023, Hélène Maxwell and Nicolas Nouvel moderated a panel featuring Tim Cowan (VP Corporate Development at Carbon Clean), Silvia Gentilucci (Technology Onshore Planning at SAIPEM) and Michael Evans (CEO of Cambridge Carbon Capture) to discuss the strengths and prospects of the CCaaS business model.

Below are the main takeaways from the discussion, also published on Aster Fab website.

Among the numerous decarbonization solutions under development, three major carbon capture applications stand out today: industrial point source carbon capture, direct air capture (DAC) and bioenergy with carbon capture. Although industrial point source carbon capture appears to be the main focus for most decarbonization roadmaps thanks to increasingly mature and cost-effective technologies driving greater deployment across industrial sites, several challenges must be addressed before it can reach sufficient scale, including policy and regulatory support, access to funding, public acceptance and further cost improvement.

Carbon Capture-as-a-Service (CCaaS) is a business model that is gaining ground in part to circumvent the huge CAPEX hurdles encountered in these type of infrastructure projects. By opting for a one-stop shop solution that handles the entire value chain, hard-to-abate industries can pay to capture their CO2 emissions on a per-ton basis, while other specialized actors take on the risk (and potential financial reward) of managing the full value chain from capture to utilization or storage.

CCUS adoption must increase 120-fold by 2050 for countries to meet their net-zero commitments

According to the latest Global Carbon Budget published in November 2022, if emissions are not reduced through decarbonization technologies such as Carbon Capture Utilization and Storage (CCUS), the world will have exhausted its 1.5°C carbon budget – the cumulative amount of CO2 emissions permitted over a period of time to keep within the 1.5°C threshold – in nine years. Indeed, the equation highlighted is quite simple: there are about 380Gt of CO₂-equivalent emissions left in the 1.5°C budget, and right now we use just over 40Gt of it each year.

As such, CCUS is recognized as a necessary piece of the decarbonization jigsaw, but the adoption isn’t moving fast enough. According to a McKinsey analysis, CCUS adoption must increase 120-fold by 2050 for countries to achieve their net-zero reduction goals, reaching at least 4.2 gigatons per annum (GTPA) of CO₂ captured.

“

The scale of the challenge to achieve net zero is so huge that we need all the best ideas. For hard-to-abate industry executives in the audience, you’re probably looking at energy efficiency as well as alternative fuels. But you’ll still have CO₂ in your process. That’s why we believe carbon capture is a necessary piece of the decarbonization puzzle and CycloneCC, our fully modulat technology, will make carbon capture simple, afforable, and scalable.

“
Tim Cowan
VP Corporate Development at Carbon Clean

Carbon Capture-as-a-Service (CCaaS): shifting capital cost to service providers, thereby allowing emitters to focus on their primary activities

In 2021, Decarb Connect conducted a benchmarking survey of industry attitudes towards CCUS that revealed that 65% of executives working in hard-to-abate industries see CCUS as ‘critical’ or ‘important’ for reaching their 2030/2050 goals. It also reveals that 41% are favorable to as CCaaS model, while 59% prefer a mix of funded and owned CCUS. In other words, no executive opted for the traditional model of owning and operating the infrastructure themselves.

Thus, the CCaaS business model appears to be a promising way to accelerate the adoption of carbon capture technology for industrial players:

  • No required upfront capital expenditure
  • Duty to contract with each player of the value chain is delegated

“At Carbon Clean, we use our leading technology to capture CO₂. and will work with partners to provide the other crucial elements of the value chain: compression, transportation, sequestration or utilization. Our mission is to work with industrial partners to offer an end-to-end handling of our customers’ CO₂.” Tim Cowan, VP Corporate Development at Carbon Clean.

 

Scaling the CCUS industry will require action by governments and investors

Tax credits, direct subsidies and price support mechanisms are beginning to encourage investment in CCUS. The US, for example, has a 45Q-tax credit that provides a fixed payment per ton of carbon dioxide sequestered or used. The IRA (Inflation Reduction Act) has increased the amount of the credit from $50 to $85 a ton for sequestered industrial or power emission, and from $50 to $180 a ton for emissions captured from the atmosphere and sequestered.  In other words, they provide a direct revenue stream immediately improving the investment case for low-carbon technologies, such as CCUS. What the IRA calls tax credits, the EU calls State Aid. Yet, the panelists affirm that while the EU led the whole decarbonization movement for 30 years, the EU is now behind in terms of policy.

“

It is going to be very challenging for CCUS as it currently stands to make the whole thing stack up. I don’t think the carbon tax will be the viable way forward in the long-term. We need other incentives, as the US are currently doing with the IRA. Many innovative policies are starting to come out of the US and this will encourage innovative companies to set up operations there, giving the US a competitive advantage over the UK and EU in what will become a significant new industry.

“
Michaels Evans
CEO of Cambridge Carbon Capture

There is a need to scale the whole carbon capture value chain

Another element is the uneven distribution of storage sites across Europe. Often illustrated as the ‘chicken and egg’ paradox, there is a need to scale the value chain as a whole, including storage infrastructure. Indeed, a carbon capture plant will not start operating until the captured CO₂ can be transported and then either permanently stored or used.  Similarly, no large-scale carbon storage project will be financed without clear commitments regarding the origin and volume of CO2 to be stored, as it determines the financial viability of the overall project.

“

In Italy, there are plans to build infrastructure using depleted reservoirs in the Adriatic Sea for local storage of CO₂. Without adequate transportation and storage infrastructure, industry will not be able to adopt carbon capture technologies.

“
Silvia Gentilucci
Technology Onshore Planning at SAIPEM

Norway’s Longship project, which is sponsored by the Norwegian government, aims to solve this problem by supporting the whole value chain from carbon capture to transportation and storage. Captured emissions will be transported by tankship and stored deep underground using Northern Light’s open-access CO₂ transport and storage infrastructure.

Garnering public support

Finally, speakers also emphasized that addressing public concerns around the safety of these technologies will be paramount. Communicating that carbon capture is safe, effective and a needed method of climate change mitigation, can help bring people on-board and ensure that projects overcome development hurdles. “I think honesty in the media about the situation would be a true incentive. If the public understood how urgent the situation is, and understood more about the technology, there would be a lot more action”. Michaels Evans, CEO of Cambridge Carbon Capture

Source: Aster Fab

For companies

Hey you! If the vision shared in this article resonates with you or you are out there building the future of CCaaS 🦄, ping me on LinkedIn 📩.

Warehousing1 has announced the completion of its €10 million Series A funding round, co-led by Wille Finance and Aster, with participation from DB Schenker and existing investors HV Capital and Base 10.

With this additional money, the company, led by the talented trio Nils Aschmann, Fabian Sedlmayr and Nico Szeli, will focus on doubling down on its product development and international expansion. Their medium-term goal is to become the player of choice for European merchants that want to have logistics services that meet the high standards set by Amazon without being dependent on  the US tech giant.

At Aster, we have been diving deep into the logistics space as a whole for some time and were particularly convinced about the opportunity to join forces with Warehousing1 for several reasons.

Covid-19 has accelerated an already growing trend for e-commerce in Europe

Warehouses and fulfillment centers have been the nervous system of the global economy since the Covid-19 pandemic stroke in early 2020. As consumption shifted massively online, brands and retailers understood that the new battleground for winning customer satisfaction and retention was the delivery experience. Covid-19 was not solely responsible for this. Since its inception, Amazon has been raising the bar in terms of customer expectations, with next-day delivery for Prime-labelled products now the norm in most urban agglomerates. Even before Covid-19, e-commerce revenue in Europe had been growing strongly, sustaining a 9% CAGR for the last 5 years. Covid-19 provided a great 20% YoY growth boost, as direct consequence of country lockdowns. Storing and fulfillment operations, a key link in the delivery value chain, started to come under pressure: this has created a great momentum for innovation (and startups) in this space.

Thus, we started to investigate how e-commerce brands and retailers have been facing the surge of orders behind the scenes, and here’s what we found out:

Scaling digital interfaces takes months, while scaling physical operations take years.

Today, online retailers can scale their e-commerce business in months with modern digital tools spanning from sales (Shopify, Amazon), marketing (Google Ads, Mailchimp), payment (Stripe, Klarna) and customer experience (Zendesk, Zenloop). However, when it comes to scaling logistics, retailers still need to go through months of logistics service provider (LSP) evaluation and IT onboarding and repeat the entire process each time they reach maximum warehouse capacity or want to enter new geographies and/or markets.

Alternatively, brands and retailers can also rely on e-commerce giant marketplaces, such as Amazon, and their logistics infrastructure. However, this is not the preferred option for growing D2C brands, which wouldn’t be able to fully communicate their brand by selling on Amazon. Furthermore, Amazon turns down accounts that do not generate sufficient volumes – thus retailers need alternatives. For merchants that do not want to rely on e-commerce giants for their logistics operations, independent platforms such as Berlin-based startup Warehousing1 are the most attractive option.

Warehousing1 offers one of the most complete product suites on the market

Warehousing1 has created a marketplace that connects fast-growing online merchants within dependent LSPs. Warehousing1’s clients can access all LSPs on the platform and scale their warehousing and fulfillment capacity instantly, with no upfront costs and without the hassle of sourcing, evaluating, and negotiating with LSPs themselves. Thus, they can focus on what they love most: creating outstanding products for their customers.

But Warehousing1 is far from being  a mere broker of logistics services. Nils, Fabian and Nico, along with their great team, built the software infrastructure to seamlessly connect IT systems of merchants and logistics providers. This gives merchants real-time visibility of orders and inventory, enables automated change and cancellation workflows and the updating of fulfilment rules.

Likewise, Warehousing1 has a compelling value proposition for LSPs, as it makes them instantly visible to a myriad of online merchants who are striving to scale their logistics and bring new business to them without any additional overhead costs.

Joining forces with a high-potential founding team that is undertaking a long journey to crack the e-commerce logistics space.

While several startups in the e-commerce logistics space have already received strong VC attention, we believe there is still a long way to go. Specifically, we are interested in the warehousing and fulfillment-as-a-Service “space”, which offers all the benefits of decentralized warehousing, without its major drawbacks (higher operating and inventory costs). Specifically, through a network of geographically distributed warehouses, shippers can:

  • Reduce shipping costs and delivery times by storing their products closer to their customers;
  • Expand storage capacity without having to build or lease new infrastructure, simply by upgrading their subscription;
  • Mitigate the risk of labor shortage by spreading inventory across different locations.

We are very proud to back the three co-founders of Warehousing1 and, while this is their first startup founded and led together, we believe that their previous experience is very relevant to what they are trying to achieve.

Neil worked in supply chain management at DSM and as a consultant at Porsche where he learned about contract logistics and the challenges faced by fast growing e-commerce players.

Fabian worked at an LSP and later as a consultant at PwC and McKinsey & Co. He met Nico, the third co-founder, at the Barcelona-based startup studio HS3,, who previously worked in market strategy and planning for Procter & Gamble.

Their first-hand experience of the logistics challenges, for both industrial and e-commerce players, as well as their strong commitment to becoming the reference e-commerce fulfillment and logistics service platform European fast-growing European merchants, make us even more excited to join forces now, at the beginning of the journey to the conquest. 🚀

Congrats to Nils Aschmann, ,  and their team for what you have been accomplishing so far and quite exciting to joining forces along the route to make of Warehousing1 the best alternative to e-commerce giants for #fulfillment and #logistics services across Europe

Warehousing is king 👑

Warehouses and fulfillment centers have been the nervous system of the global economy since the Covid-19 pandemic stroke in early 2020. As consumption moved massively online, brands and retailers understood that the new battleground for winning customers satisfaction and retention was the delivery experience. We cannot blame only Covid-19 for this. Since its inception, Amazon has been raising the bar in term of customer expectations, with at least next-day delivery for Prime-labelled products being today the norm in most urban agglomerates. Storing and fulfillment represents a key link of the delivery value chain and good a potential candidate for becoming its bottleneck. Thus, we decided to investigate whether venture capitalists should seize the momentum and fuel the next generation of warehousing and fulfillment technologies and business models.

Automate, automate, automate! 🦾

Facts

Automation of warehousing and fulfillment operations has just started. It is estimated that by 2025, more than 4 million commercial robots will be installed in over 50,000 warehouses, up from just under 4,000 robotic warehouses in 2018.

Labor costs could account up to 35% of warehousing and fulfillment costs in Europe, with picking being by far the costliest operation. Renting the facility does not exceed, usually, 30% of the total costs.

The recent spike in quick-commerce startup allowed for a new type of warehouse to emerge: the city hub – a small warehouse located in urban areas that allows faster delivery times. These city hubs are usually costlier to maintain, thanks to the higher rent and wages that need to be paid in city centers.

Aster’s view

The coming years will know a great wave of warehouse automation. As logistics and fulfillment market expand thanks to e-commerce growth, the need for a more efficient and productive delivery infrastructure will intensify. We believe that automation needs will be even stronger in urban warehouses, where operating costs are higher – and thus saving potentials are greater.

Let’s re-engage warehouse workers 👷‍♀

Facts

Following the recent spike in demand of warehouse associates, attracting new workers and retaining existing ones is becoming more and more difficult, especially in the North American and European markets, where many organizations’ annual turnover rate exceeds 100%. It is no secret that the job is highly repetitive and physically demanding.

Amazon is trying to make the job less tedious through gamification: workers can compete in various games by completing warehouse tasks and can win digital rewards, such as virtual pets 🐶 and real-world items.

It is estimated that in less than 4 years, 75% of the workforce will be represented by Millennials, the first generation that grew up with digital technology at their fingertips. However, the penetration of digital tools among warehouse workers is low, and processes are either paper-based or reliant on legacy software with awful UX.

Aster’s view

In the fight for talent, employers will understand the need to make the warehouse routine more engaging and the work environment safer.

Frontline workers will benefit from a wave of digitalization thanks to modern productivity software and it is likely that if the Amazon gaming experiment succeeds, other employers will follow the delivery giant example.

To make the warehouse associates work less dangerous and tiring, exoskeletons and other wearables, if they will gain acceptability among the workforce, by essentially being more comfortable to wear, could represent a solution.

Warehousing-as-a-Service is booming 💻

Facts

Companies are more and more selling services, rather than just products. Consumers today can subscribe to pretty much everything you can think of: music, video streaming, cars or even just… pickles! 🥒 This paradigm shift has approached the logistics world as well, with a growing number of companies offering flexible warehousing space in different locations to brands and retailers in return of a monthly subscription fee that depends on the capacity used and on the number of orders fulfilled.

Aster’s view

Source: Aster

Warehousing and fulfillment-as-a-Service is a winning formula, which brings all the benefits of decentralized warehousing, without its major drawbacks (higher operating and inventory cost). In fact, thanks to a network of geographically distributed warehouses, shippers can:

  • lower shipping costs and delivery time by storing their products closer to their customers;
  • expand storage capacity without the need to build or lease new infrastructure, but simply by upgrading their subscription;
  • mitigate the risk of labor shortage, by having inventory distributed in different locations.

At Aster, we strongly believe in the widespread adoption of this model in Europe in the coming years (as it already happened in the US).

Want to know more about which companies are shaping the warehouse of the future?    ⤵

Source: Aster

For founders

Hey you! If the vision shared in this article resonates with you or you are out there building the future of warehouses 🦄, ping me on LinkedIn 📩.

The softwarization of the car is on the way

The ACES (Autonomous, Connected, Electric, Shared) trend in automotive has accelerated the ‘softwarization’ of the car. In particular, Electric Vehicles, now an accelerating trend embraced recently by most OEMs, is paving the way for software-defined vehicles to become the norm due to batteries showing that good software management can actually bring more performance or life-time than costly hardware innovation.  

This move towards both electrification and software-defined is a fundamentally challenging shift for OEMs, having to fight two fronts at the same time, each of them being difficult and requiring a completely different set of skillsets. Most traditional OEMs and Tier 1 suppliers today do not have the resources and know-how in-house to develop every feature needed to compete in a market that is being rapidly disrupted by players such as Tesla and challenger OEMs such as NIO. Electrified and autonomous cars require significantly more software than traditional ICE vehicles – when looking at EVs for instance, a key component is the battery (it directly impacts the TCO, environmental impact and competitiveness of the car), and the BMS can hence be a critical component of differentiation for OEMs. 

Given their lack of expertise in these new and complex technologies, OEMs will look to have a more collaborative approach towards sourcing hardware and software for upcoming vehicle models. There is space in the market, therefore, for software players that can help OEMs along the value chain improve the competitiveness of their cars and components via a fast route to market. Consequently, we can imagine a future where automotive software applications deployed on the cloud and on the edge are provided as standard, hardware agnostic offerings while OEMs maintain their competitive advantage on the hardware side.  

However, this new opportunity for software-driven entrants comes with a caveat – automotive software has stringent regulatory, security and safety requirements, which is why several software-driven startups in the market struggle to move to the production phase with OEMs despite having unique and promising approaches. 

 

Eatron is deploying automotive grade BMS and ADAS 

Eatron’s software modules enable modular, hardware independent electrification and autonomy for ‘anything that moves and is battery powered’.  

Eatron’s core products have strong synergies in the back end as they were built on the same building blocks with AI models layered on top of physic-based deterministic models, allowing them to leverage explainability (critical to become automotive grade), high performance especially on edge cases and strong data network effects. This has enabled Eatron to show promising traction with OEMs and system integrators. For the OEM, Eatron’s modular platform offers greater flexibility, lower costs, faster time to market and continuous improvements over the lifetime of the vehicle. 

We believe that Eatron’s pragmatic approach, marked by concrete commercial and production milestones that they are expected to achieve in the short-term, positions them well to capture significant early market share within the BMS and ADAS (for premium automotive OEMs, logistics and micro-mobility) segments.  

 

Eatron is led by a stellar team focused on quality and execution  

We are very proud to back the three co-founders of Eatron and have been impressed by their vast experience within the field and their ability to execute rapidly since day one.  

Umut was the founder and managing director of AVL Turkey where he built, grew and managed two R&D centers – his extensive experience in engineering spans 20 years in the field of controls, software, calibration and e-drive development for automotive critical systems. Can has 15+ years of experience in controls and estimation systems development, and software development in automotive and aerospace. He also has 10+ years of experience in battery and BMS serial production programs. Amedeo has a mixed skillset of business development, management and engineering developed across roles at AVL, Ford, Fiat Group and Ducati which reflect in Eatron’s stellar commercial performance to date. 

With their razor-sharp focus and vision to disrupt the BMS and ADAS for automotive markets, the team has a great opportunity in front of them: to be the go-to supplier for electrified and autonomous system software. 

From 2014 to 2019, VC investment in European industrial tech startups increased from €100m to €1.1b. However, despite this impressive growth, industrial tech accounted for only 3% of all European VC funding in 2019. Interestingly, there is a sharp contrast between VC funding in industrial tech, and the actual contribution of the industrial sector to the economy. Indeed, in 2020, the manufacturing sector accounted for about 22% of the EU’s GDP. In addition, the European manufacturing sector, which is amongst the least digitized, has been suffering from a decline in productivity growth over the past 15 years and is facing increased competition from foreign players. As such, we firmly believe that the European manufacturing sector will need startup-driven innovation to boost its productivity and thereby increase its competitiveness.

This begs the following question: how can manufacturing companies become more productive?

There are many ways to answer this question, but today we will focus on how the industrial tech stack can lead to productivity improvements in manufacturing. First, we need to understand what the industrial tech stack actually is. The industrial tech stack is a complex structure composed of 4 layers, each containing software and hardware components:

Source: Aster

Unfortunately, in most factories, the tech stack is full of inefficiencies:

  • Old unconnected machines: it is not uncommon to find aging, sensorless equipment on the factory floor, as replacement cycles for heavy assets often last decades.
  • Unconnected stack layers: PLCs are not necessarily connected to SCADA systems, the SCADA system of different processes are not necessarily connected to each other, and the MES is not always fully connected to all processes in the factory.
  • Lack of data harmonization and interoperability: factory data can come from many different sources (sensors, SCADA, MES, Excel sheets, PLCs, …) and in many different forms (structured, semi-structured or unstructured). In addition, machines and software used in factories can be quite old, often come from different suppliers, and often have different communication protocols.
  • Lack of IT/OT collaboration: the firm (IT) and factory (OT) levels are often not fully integrated, resulting in a poor understanding of factory processes at the firm level. The factory is basically seen as a black box by the firm level, and this is called the “IT/OT convergence” problem.

Clearly, we can see that the main problem with traditional tech stacks is that industrial data is hard to collect and difficult to integrate. Without access to industrial data, implementing use cases that lead to productivity improvements – such as process optimization, predictive maintenance or automated quality control – is quite challenging.

We believe that startups can help manufacturing companies improve their industrial tech stack in 3 different ways:

  • Data collection: provide hardware/software to connect old legacy machines to IT/OT networks and provide middleware or connectivity to facilitate data collection from sensors and machines.
  • Data harmonization: provide software to integrate, harmonize and generate insights from industrial data across the factory floor or even across different factories.
  • Decentralization: bridge the gap between the firm- and machine-level through edge-computing, allowing machines to interact with each other and take more autonomous decisions. The idea is to connect machines to each other, to operators and to the firm-level in order to have flexible production lines that take into account not only factory (OT) data to take decisions, but also firm (IT) data. For example, this structure could enable machines to change their parameters automatically to produce different products based on demand forecasts made at the firm-level.

Our view is that the future industrial tech stack will be decentralized, and we look forward to seeing more companies contributing to this trend. However, in the short- to medium-term, we believe that there is value in helping manufacturing companies through data harmonization. As such, we believe that startups that will stand out in the space will be those that:

  • Harmonize and contextualize structured/semi-structured/unstructured data from a large number of sources (MES, SCADA, PLC, sensors, Excel sheets, …) and are able to easily integrate into the existing stack of customers.
  • Provide a clear and measurable ROI to customers.
  • Enable the interconnection of devices in manufacturing operations with a low-code/no-code approach.
  • Focus on making production lines flexible, more autonomous and directly connected to the IT level.
  • Provide edge computing with a low latency, low costs, AI and ML capabilities, real-time analytics and focus on working towards IT/OT convergence.

Source: Aster

Otoqi has announced the completion of its €6 million Series A funding round, co-led by Seventure Partners and Aster. With its AI-powered software and its community of freelance drivers, Otoqi is on a mission to help OEMs, dealers, rental companies or car-sharing specialists manage the relocation and charging of vehicles. This first round of Venture Capital funding will help the team to expand its mobility platform across Europe.

At Aster, we were particularly convinced about Otoqi for several reasons: the growing market opportunity, the unique approach and the team’s execution capabilities.

Enabling the automotive revolution…

In recent years, the traditional car ownership model has been challenged by the emergence of carsharing and new digital offerings aiming to provide better rental, leasing and/or purchase experiences. We believe that Otoqi’s solution will help all kinds of mobility players build a profitable operational model and brick-and-mortar car dealerships attract new digital customers.

Specifically, Otoqi addresses two main markets:

  • OEMs and dealerships: they need help to deliver end-to-end digital offerings to customers. Reinforced by the Covid-19 pandemic, increasingly more consumers expect digital/virtual services before and after a car purchase.
  • Carsharing operators: to make this business model viable, they need help to reduce their operating expenses, increase the quality of service and user experience and ultimately improve the usage rate of their vehicles. In Europe, the number of carsharing users is expected to reach 36 million by 2025, representing a €9.3bn market opportunity.

…by being the operational soul of mobility players…

At a time when margins are being squeezed by increased price competition and the proliferation of alternative services, Otoqi offers a tool to reduce operating costs and facility-related expenses, thereby reducing the break-even point for carsharing operators.

The same ROI-focused approach has been developed for car dealers: Otoqi can help them boost their revenues and generate a much better user experience by offering new digital pre- and post-sales services (such as maintenance pre-packages) to car dealers and garages. The uniqueness of the solution is due to superior technology, flawless deployment and great management of a strong community of freelancers.

… an A-team with outstanding execution skills

When we first met Sébastien and Arthur, we were very impressed by their pragmatism in achieving remarkable milestones with so little. In just a few years and without VC funding, they had managed to generate considerable revenue with a solid operating model.

Sébastien and Arthur have worked together at Air Liquide for several years and complement each other very well. Sébastien’s outstanding skills in complex B2B environments and Arthur’s ability to manage technical operations are what it takes to scale fast in the new mobility B2B landscape.

With their vision and grit to disrupt the market, they have a great opportunity ahead of them: to consolidate their leadership in the automotive retail market and expand across Europe to become the new operational standard for enabling massive expansion of carsharing services. Our goal and mission at Aster is to act as a catalyst through our ecosystem of industrial partners and to support the company in its ambition to become a global leader in strengthening the capacity of automotive players.

Congrats to Sébastien and Arthur for what you have been able to accomplish so far, and we look forward to joining forces to make Otoqi an amazing success story.

A unique positioning in a rusty market

As a consumer, chances are you see the car market as liquid and simplistic: if you want to buy a car, all you have to do is (1) go to a car dealer or (2) use one of the many B2C or C2C digital platforms to browse and purchase a new or used vehicle online. The car purchasing process has become even simpler in recent years with the entrance of many digital players challenging the traditional ownership model with Car-as-a-service offers, providing individuals with flexible solutions to easily rent or lease cars.

While various platforms are facilitating B2C used car transactions, B2B car transactions are lagging behind in terms of digitization. Auction houses (BCA…) and B2B marketplaces (Auto1, which just successfully IPOed), which have always been the reliable middlemen for B2B players to sell/buy and move used cars, generally have a poor UX, are mutually exclusive and rely on cumbersome processes.

In this context, 2trde has emerged as the most effective digital solution to help B2B players sell their used cars through any channel they want, offering greater reach and better prices than any other marketplace. This is made possible thanks to 2trde’s SaaS/mobile platform, which allows customers to (1) collect all the data they need on the cars they want to sell, (2) aggregate marketplaces, auction houses and private sales under a single interface, and (3) set up sales “cascade”, i.e parameters about which cars can be sold to which groups of buyers in which order.

This “umbrella” approach makes 2trde a true ally for vendors, who not only benefit from better prices & better car turnover, but also find it beneficial to use its transparent platform outside of transactions. The opportunity to create a data standard for B2B car transactions through a trusted third-party is exciting and will likely be even-more necessary in an EV-driven world, where we expect every player across the value chain to be able to provide information on the batteries of cars they want to sell/buy.

Network effects everywhere

The B2B used cars market is a real can of worms, made up of several stakeholders (OEMs, rental companies, leasers, affiliate dealers, independent dealers) who all have different expectations in terms of price, timing, logistics and liquidity. As mentioned, B2B marketplaces and auction houses have emerged as solutions to fluidify B2B exchanges, but it is not certain that a “one size fits all” approach will ever emerge to cover all needs, and that multi-tenanting will remain the norm. Rather than trying to fight this, 2trde’s SaaS helps vendors connect to their own networks of buyers to complete a sale. By doing so, buyers will also benefit from the 2trde experience (enriched data on the cars they just bought + amazing UX). When these buyers would like to sell vehicles at some point or even when they will want to find pricing information about the B2B used car market, they are likely to use 2trde to connect to their own buyer networks. This network effect is all the more powerful as it can work for inter-company transactions (e.g., BMW Germany selling cars to its French subsidiary) and brings added value to both vendors and buyers simultaneously, but not only. In our view, it is one of the most interesting ways of creating a shared data standard across a disparate industry.

A team of experts with a proven track record

Carving out a place within the automotive industry is not easy: specific industry knowledge is essential, sales cycles can be long and many parts of the B2B sales process are still done with pen and paper. For these reasons, being credible is not an option. From day one, we have been amazed by 2trde’s maturity as a company and by its CEO Johannes’ vision and ability to surround himself with leaders in the automotive industry who will bring him to push the company to the highest level. We are also glad to invest alongside Israeli-based VC Maniv, whose in-depth knowledge of the automotive industry will contribute to 2trde’s success at an international level.

Herzliche Glückwünsche!

In recent months, many carbon footprint management solutions have emerged and/or raised significant funding. This trend caught our attention: we have always been convinced that it is important to reduce your carbon footprint as an individual (starting with switching to 👋 ekWateur for instance), but is this topic about to reach maturity in B2B sectors?

Carbon dioxide (CO2) increasing concentration in the earth’s atmosphere is the first human-caused source of global warming. CO2 emissions tracking consists of all initiatives to report, monitor, measure but also to reduce, offset and remove the CO2 from the air.

In recent years, three sectors have stood out as the fastest-growing sources of CO2 emissions: industrial processes have increased by 174%, transportation by 71% and manufacturing and construction by 55%.

In light of this, and driven by EU regulations (the Emissions Trading Scheme, the European Green Deal, etc.) and consumer awareness, the carbon footprint management market is expected to reach a size of $12.2bn by 2025. Long held back by the high cost of carbon footprint reduction and insufficient public incentives, many solutions are emerging to help industrial players monitor their emissions. The value propositions are primarily focused on improving brand image, engaging employees, complying with regulations and reducing emission-related costs.

The field has been quite active with VC deals all along the emissions tracking value chain.

Source: Aster

Many players are emerging, but differentiation remains fairly low. Therefore, we believe that the startups that will stand out will be those that:

  • Fully automate data collection and use AI algorithms to recommend the best emission reduction plans,
  • Create strong product stickiness by delivering an above-average UX,
  • Focus on a specific, highly regulated industry to ensure broad adoption and strong ROI,
  • Develop comprehensive tools with bundled offers from data collection and monitoring to reducing/offsetting options,
  • Leverage a strong network of assessment or offsetting partners to increase value and create strong network effects.

Source: Aster